There are a number of financial proceedings before and during one’s stay in a retirement village. In some cases, there can also be additional cost in the form of maintenance payments. It is finally good to have newer legislations for the protection of customers concerning transparency of policies and smooth payments upon exiting. Although retirement villages are supposed to non-profit organizations, some of the contracts do not seem to be fair for the customers. Given below are various financial aspects of living in the retirement villages.
- Move in cost
The cost for moving in actually varies considerably depending on the strata title of the retirement village. The operators generally keep the fees so as to encourage the elderlies to move in. the units are given out at a discount of 70% as compared to their original price and the differences are settled upon a resale. This way, retirement villages tend to be much cheaper than a private housing unit bought independently in the same area. The prices are even lower if the customers decide to opt for some of the shared community facilities. With this, the units are sold at 85% of the median price. However, some of the operators charge additional DMF which makes the discount pretty much redundant. Therefore, it is best to consult a legal advisor before making any contracts.
- Ongoing costs
After you have moved into one of the retirement villages, you will be required to make regular payments which are also known as maintenance or recurrent fees. The average cost is $10 a day but if there are more facilities, the residents are required to make more payments. To make their offers attractive, some operators may show lower ongoing fees but charge a lot during exit. The additional fees can also be unnecessary and wasteful if the residents are not going to use them at all. Since these villages are run entirely with the money obtained from residents, there have been legislations concerning a clear understanding of the operation process and the transparency of the various financial transactions.
- Exit payments
During the time of exit, the residents are entitled to some amount of money. Since some operators have the DMF constituted on the selling price rather than the price at the time of ingoing, it can lead to complexities. Moreover, if the contracts state the unit’s capital cost to be handled entirely by the operators before being handed over to the customers, there could be an even greater deduction in the payments. Sometimes, the residents are also asked to refurbish the place so as to increase its sale value with their own money.
- Selling the unit
If the contracts do not provide enough protection of the residents, the entire proceedings of sale are left upon the customer. Since it may not be easy to grab a customer right away, the process could be delayed by a considerable amount of time. On the other hand, operators taking charge of the proceedings can help in making swift payments.